Bank interest rates under attack from the bottom-up

A bottom-up liberalization of interest rates by largely unregulated tech companies is challenging China’s formal banking sector, South China Morning Post reported, citing lending and deposit statistics. News of the imminent launch of Tencent’s (0700.HKG) private Shenzhen Qianhai Weizhong Bank has only added to the unease among medium-sized lenders, the financial institutions most affected by the rise of non-bank finance. The Tencent outfit is the first of five pilot private commercial lenders to gain official clearance to open on the mainland. While peer-to-peer lending facilitated by online financing had jumped 140% from January to October to RMB74.4 billion, medium-sized national lenders have seen a wane in deposit growth.